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Understanding how to better manage psychosocial risks at work can enhance employee wellbeing and overall productivity.

Workplace safety has traditionally focused on physical risks, but a growing awareness points to another crucial factor: psychosocial safety. 

Psychosocial safety – how work environments impact mental health and wellbeing – is gaining increased attention as governments and regulators focus on how organisations treat their employees.

A showed that mental health conditions accounted for 9% of all serious workers’ compensation claims, a 36.9% increase since 2017-18. The most common mechanism attributed to claims for mental health conditions were work related harassment and/or workplace bullying (27.5%), work pressure (25.2%) and exposure to workplace or occupational violence (16.4%).

Associate Professor Carlo Caponecchia, Associate Dean of Diversity, Equity and Inclusion at UNSW Science said in a recent episode of The Business Of that new addressing psychosocial risks have been introduced in all Australian states except Victoria. 

“It's important to say that these are not new requirements. They've just been emphasised or elevated. The fact that psychological health and safety weren't being protected has meant that it's been elevated in the regulation.

“What these changes really mean is that you have a duty to control the things within your control, the things in your system of work, the way the work is organised, supervised, managed, where it's done and how it's done,” he said.

Understanding psychosocial hazards

Psychosocial hazards are often less visible than physical risks but can have a significant impact on employees' mental health and wellbeing. A/Prof. Caponecchia said that these hazards typically arise from the way work is structured, the organisational culture, and relationships within the workplace.

“When we're talking about psychosocial hazards, we're talking about sources of harm that exist in the work system that can have a negative effect on your physical and psychological health,” said, A/Prof. Caponecchia. 

“They include factors like excessive workloads, unclear job roles, and lack of support.” 

A/Prof. Caponecchia shared a case study that illustrates the impact of psychosocial hazards on workers. 

He told the story of a skilled construction worker in his 50s who, after being assigned a two-month project in New South Wales, experienced significant psychosocial challenges. The job extended to five months, and the worker faced several mental and physical issues due to inadequate accommodation and isolation. 

His accommodation was an hour's drive from the worksite, leading to an additional two hours of daily travel. The remote location lacked basic amenities, and the worker felt unsupported with minimal supervisor interaction.

A/Prof. Caponecchia said that the situation could have been mitigated by redesigning the company's travel and accommodation policies. Providing closer accommodation, ensuring regular supervisor check-ins, and reconsidering the project's duration or feasibility could have significantly reduced the psychosocial risks.  

“Now that seems like a really simple scenario. The redesigns that businesses could have thought about were many. For a start, one of them that would have solved a lot of things was to think about how their policies and processes around travel and accommodation might have been amended such that they could have put him up somewhere close to the job.”

A/Prof. Caponecchia said that this case underscores the need for businesses to consider the broader impact of their policies on employees' mental health and wellbeing, and to integrate psychosocial safety into their planning and decision-making processes.

“For the people who were writing the travel policy, for the accountants, for the finance people thinking about, how do we spend money so that we don't unnecessarily endanger people,” he said.

When unmanaged, these hazards can lead to mental health conditions such as anxiety, depression, and burnout – issues that not only harm individuals but also contribute to absenteeism, lower productivity, and higher turnover. 

Practical steps for addressing psychosocial safety

To help create a psychosocially safe workplace, businesses need to take a proactive stance, said A/Prof. Caponecchia. Addressing psychosocial hazards requires a shift in workplace design, management practices, and employee interaction. 

He said that hiring more workers to fix a high workload issue is not actually very practical. “What we try to do is think about all the small elements of jobs that have the potential for some change that's beneficial,” he said.

“Perhaps we can look at the timing of particular tasks... cross-skilling of our teams... how we might offer opportunities for professional development... [to] make that job less harmful.”  

On a broader scale, A/Prof. Caponecchia said that psychosocial safety “is not about managing mental ill health. It's about managing the things in your business that could create those outcomes in future.” 

This shift in approach ensures that businesses focus on preventing harm before it happens, creating a healthier work environment for everyone.

Redesigning businesses for psychosocial safety

Addressing psychosocial safety is not only a regulatory necessity but also a strategic advantage for businesses and Michael Quinlan, Emeritus Professor in the School of Management & Governance at UNSW Business School, said the importance of this and its impact on psychosocial hazards through his research. 

Prof. Quinlan’s work, detailed in his paper , challenges traditional models and emphasises the importance of considering historical and contextual factors in managing workplace risks.

“My research showed that psychosocial hazards are not new; they have been documented for over a century. However, understanding the complexities of work organisation, including power dynamics and job insecurity, is crucial,” said, Prof. Quinlan. 

“Addressing these factors involves a multi-model approach that goes beyond the commonly used frameworks, incorporating insights from industrial relations and organisational dynamics.

“Organisations that implement effective psychosocial safety measures experience higher employee engagement, lower turnover rates, and enhanced overall performance,” said, Prof. Quinlan. 

“The benefits are clear: employees in supportive work environments are more motivated, productive, and less prone to burnout.”

Prof. Quinlan said the benefits of involving workers in decision-making processes. 

“If we're going to make work that is both productive and healthier and safer into the future, we need to do that by involving workers meaningfully in decision-making processes about their work,” he said. 

“We can't rely on leaders, corporate chiefs, executives, or consulting firms to make those decisions. 

“Because the record is they do it very badly. And they do it for a set of interests, their own set of interests, but not that of the great workforce. And that's the reason I think we're finding psychosocial hazards are becoming such an issue,” he said.